The discussion explains the Free Cities Foundation model as an attempt to create more voluntary, market-based governance through autonomous jurisdictions. It focuses on lessons from China, Hong Kong, Singapore, Honduras, El Salvador, Panama, West Africa, and emerging “parallel structures” in governance, finance, and education.
From China to Free Cities
The speaker spent about 10 years in China after originally planning to stay for only one year teaching English.
He later worked with the British embassy in China on trade and investment. Around 2017, while still connected to China and government-related work, he became more interested in libertarian ideas and the Austrian school of economics.
Bitcoin was a major influence. At the time, Bitcoin was a large phenomenon in China, and many people interested in free-market money were also interested in free-market ideas.
Between 2017 and 2020, the speaker studied Austrian economics more deeply and eventually discovered the organization then known as the Free Private Cities Foundation, now rebranding as the Free Cities Foundation.
The appeal was that the foundation offered a practical model for applying market principles to governance.
China and the Free-Market Lesson
The speaker expected China to be highly communist, but his experience on the ground was more complicated.
China was described as communist in some specific ways, but also more free-market than the United Kingdom in others.
Examples mentioned:
- No welfare state comparable to the UK
- Less regulation in many areas
- Stronger business-like attitude
- High levels of entrepreneurship
- Significant freedom for small-scale business activity
Small entrepreneurs in China were described as having room to operate with relatively little regulation, especially below a certain income threshold.
The speaker mentioned a threshold of about 4,000 RMB per month, under which small-scale activity could often occur without income tax or detailed declarations.
This was contrasted with Western countries, where even small activities may face regulations. One example mentioned was a story from Texas where two young girls selling eggs in their front yard received a cease-and-desist order.
Shenzhen and Special Zones
Shenzhen is presented as one of the strongest examples of rapid development through special economic zones and autonomy.
The city’s rise is tied to China’s decision to create a more open economic zone there decades ago.
The speaker highlights Shenzhen as a major example of agglomeration benefits: when a free or semi-autonomous jurisdiction is created, the host nation can benefit from the growth around it.
Comparable examples mentioned include:
- Hong Kong
- Singapore
- Monaco
- Shenzhen
The broader lesson is that autonomous or semi-autonomous jurisdictions can create prosperity quickly when they allow freer trade, investment, and enterprise.
Why More Governments Do Not Copy Hong Kong or Singapore
The discussion argues that majoritarian democracy makes it difficult to adopt policies like Hong Kong or Singapore.
In one-person-one-vote systems, politicians need simple messages that appeal to many voters. More abstract economic ideas, such as how free exchange reduces poverty or how markets coordinate large groups, are harder to explain.
The speaker says humans are better adapted to small social groups than to understanding macro-scale systems.
As a result, many Western political systems tend toward:
- More regulation
- Larger government
- Coercive redistribution
- Policies that sound appealing but may harm long-term growth
The Free Cities Foundation therefore focuses less on convincing entire populations and more on building voluntary alternatives that people can opt into.
Build New Systems Instead of Winning Elections
The foundation’s strategy is to build parallel systems rather than try to persuade millions of voters at once.
The argument is:
- If a new jurisdictional model is better, people can voluntarily move to it.
- If it is worse, it will fail.
- If it works, it can become an example others copy.
This approach is contrasted with conventional politics, where countries such as the United States, Canada, and European states have continued to become more regulated and more expensive despite repeated political campaigns.
The foundation’s goal is to help create new Hong Kongs and Singapores by offering people more choice in the kind of governance they live under.
Working With Governments
The foundation generally approaches governments and argues that autonomous areas can be mutually beneficial.
The pitch is that a country can allow a more autonomous jurisdiction inside its territory as a trial model. If it succeeds, the host country benefits from investment, employment, trade, and development.
Countries and regions discussed include:
- Honduras
- El Salvador
- Panama
- West Africa
- Senegal
- Nigeria
The foundation has had conversations in Latin America and West Africa, though some discussions cannot be named because of non-disclosure agreements.
The speaker says the team is relatively small, around 10 or 11 people, with a partner organization of a similar size, so bandwidth is limited.
Why Developing Countries Are a Focus
The foundation focuses heavily on developing countries because they are often looking for practical solutions.
Developed countries already accumulated capital over centuries. The United Kingdom is given as an example. Many UK houses and infrastructure assets were built during earlier periods when government spending was much lower.
The speaker notes that UK government spending historically may have been around 7–8% of GDP, while today it is around 40–50%.
Because developed countries still live off accumulated capital, they can misdiagnose why they are wealthy and assume current policies created current prosperity.
Developing countries, by contrast, may look more seriously at examples like Hong Kong and Singapore because those places moved from low living standards to high living standards within decades.
Government Incentives and Global Constraints
The discussion notes that government leaders are not the same as “the government.” Governments are collections of individuals with their own incentives.
Individual politicians may not act in the long-term interest of the country.
There are also global constraints. The speaker gives El Salvador as an example. When asked why the country does not go “full Bitcoin” and eliminate the U.S. dollar, the response was that doing so could make the country “the next Iran.”
The implication is that countries that do not follow the standard development model risk exclusion from global trade and finance.
The standard model includes:
- Borrowing from the IMF or World Bank
- Using U.S. dollar credit lines
- Operating on dollar-based payment rails
- Participating in SWIFT
- Respecting U.S. intellectual property law
- Joining major international institutions
- Following the development model recommended by mainstream economists
Countries that break too sharply from this system may face serious consequences.
Honduras and ZEDEs
Honduras is discussed as the most advanced example of autonomous-zone experimentation.
The country created Zones for Employment and Economic Development, known as ZEDEs, around 2012–2013.
These zones go beyond normal special economic zones because they allow a parallel legal structure to operate inside the zone.
Three functioning ZEDEs are mentioned:
- Próspera
- Morazán
- Ciudad Morazán / Kadir is unclear in the transcript
The speaker had visited Próspera and Morazán.
Próspera
Próspera is based on Roatán, an island on the north side of Honduras.
It is described as the most internationally famous ZEDE.
Details mentioned:
- Around 70 people working there
- Around 300 e-residents
- Expanding site
- New housing under construction
- Possible large hotel complex being brought into the site
Próspera is trying to create governance principles aligned with voluntary interaction while remaining compatible with international finance and trade systems.
Titus Gebel, founder of the foundation, was involved in setting up Próspera and in the processes surrounding the Honduran ZEDE law.
Morazán
Morazán is located near San Pedro Sula.
It is described as an early-stage development with around 64 housing units, a few businesses, and small business owners beginning to open shops, serve residents, and employ people.
Security on site is managed by a single company paid through central management.
Other services may be chosen individually. For example, residents may decide whether to pay for Wi-Fi, which costs around US$30 per month.
Political Opposition in Honduras
The Honduran ZEDEs face political pressure after the election of Xiomara Castro, whose government has been unfavorable toward the zones.
The new government campaigned partly on opposition to ZEDEs.
The main criticism is that ZEDEs undermine Honduran sovereignty because they have a high degree of autonomy.
The speaker argues that dispersed sovereignty is not inherently bad. U.S. states have autonomy within the federal system, and China’s special economic zones succeeded partly because of autonomy.
The concern is that politicians can frame ZEDEs as foreign-controlled, anti-Honduran, or a loss of national sovereignty even when they remain small and early-stage.
The ZEDE law included constitutional protections, meaning disruption is not straightforward. If the government interferes, there may be legal obligations to compensate investors.
The speaker argues that strong legal protections are essential because investment only happens when investors believe their rights will be protected long term.
Recommended protections include:
- Constitutional amendments
- International treaties
- Clear property rights
- Legal foundations that outlast election cycles
El Salvador and Bitcoin
El Salvador is described as an exciting and dynamic country with around 6.5 million people.
The government under President Nayib Bukele is described as willing to try new things.
Bitcoin becoming legal tender is presented as a bold move. The speaker says adoption is still in early stages, but Bitcoin is being used by businesses.
Large chain stores and international businesses implemented Bitcoin payment systems because it became legal tender.
Individual adoption is growing, but Bitcoin still represents a small share of everyday shop transactions.
The speaker also notes Bitcoin’s role in remittances, saying it is taking a larger share of the global remittance market.
Bitcoin Education in El Salvador
A charity called Mi Primer Bitcoin / My First Bitcoin is described as rolling out educational programs.
The plan mentioned is for children in El Salvador to learn how to use Bitcoin.
If implemented broadly, this could make El Salvador one of the first countries where a generation grows up with Bitcoin education and legal-tender usage.
The speaker believes Bitcoin may become one of the major economic stories of the next 20–30 years because it combines:
- Store-of-value and saleability-across-time properties associated with gold
- Saleability-across-space properties of digital money
- Decentralized access
- Resistance to control by a single political actor
The discussion frames El Salvador as potentially gaining a major head start if adoption continues.
Panama and Bitcoin
Panama is mentioned as another possible country of interest.
The host notes that Panama has moved toward accepting Bitcoin for settlement of debt, though not as legal tender, and that under Panama’s territorial tax system, crypto-related gains may be treated as foreign-source income with no capital gains tax.
The foundation is interested in Panama.
A partner organization, Tipolis, is headquartered there.
A project called Ocean Builders is also mentioned as being based in Panama, connected with seasteading and offshore projects near Panama.
The speaker says Panama could be a useful addition to the broader Central America free-cities conversation, alongside Honduras and El Salvador.
West Africa
The foundation has had discussions in West Africa, but the main country cannot be named because of a non-disclosure agreement.
The speaker says Africa is difficult for projects like this, but also a place where more innovation may be possible because some regions have weaker or less established institutions.
The foundation has ambassadors in:
- Senegal
- Nigeria
The Nigeria ambassador is mentioned by name as Cecile Martens.
The West Africa work is described as early-stage, except for one country where discussions have gone further but remain confidential.
Ambassador Program
The foundation has an ambassador program with around 60–70 people globally.
Ambassadors are well-connected people who are sympathetic to autonomous-city ideas and help the foundation by:
- Finding leads
- Sharing regional updates
- Making connections
- Advising on local political contexts
- Attending events
- Joining working groups
The foundation holds ambassador calls twice per year by Zoom.
Working groups may focus on topics such as:
- Government engagement strategy
- Social media
- Regional outreach
- Project leads
The ambassador network is intended to show that the movement is broader than a small central team.
Free Private City Model
The model promoted is the free private city model.
The word “private” refers mainly to private property rights.
The foundation argues that development depends on:
- Clear property rights
- Protection from aggression
- Ability to accumulate capital
- Ability to invest
- Peaceful trade
- Market-based exchange
A free private city would be run by a city operator, structured as a for-profit entity.
Citizens would be customers.
Each citizen would have a citizens contract defining:
- Their rights
- Their obligations
- How much they pay
- What services the city provides
- The legal rules they consent to
- Dispute resolution mechanisms
This is compared to a rental contract, where both sides know the terms and obligations in advance.
Services likely guaranteed by the city could include:
- Policing
- Protection of rights
- Basic infrastructure
- Independent third-party arbitration
- Maintenance of agreed services
The core principle is voluntarism: people should consent as much as possible to the rules and relationships that govern them.
Pushback Against Free Private Cities
A common criticism is that without normal regulation, companies would be free to exploit people.
The foundation’s response is that companies that do not serve customers lose business.
The speaker argues that many complaints about large corporations come from government-granted advantages such as:
- Intellectual property monopolies
- Legislation that blocks competitors
- High compliance costs that benefit large firms
- Regulation that creates economies of scale for legal departments
In a free private city, companies would be able to offer services voluntarily, but without special monopoly privileges.
The speaker argues that consumer choice can be more powerful than political voting. People can switch supermarkets, phones, or service providers much more easily than they can change national political systems.
Vote With Your Feet
The model depends on exit rights.
If residents dislike a free private city, they can leave.
The host compares this to Milton Friedman’s idea of voting with your feet.
The speaker argues that market choice gives people more direct power than voting every few years between similar political parties.
Utilities and Services
The foundation does not prescribe one exact model for utilities.
City operators can decide entrepreneurially whether services should be:
- Provided centrally
- Contracted to one provider
- Chosen individually by residents
- Offered by multiple competing providers
In Morazán, for example:
- Security is managed by a single company and paid centrally.
- Wi-Fi is chosen individually by residents.
The speaker says there is no one-size-fits-all answer. Different projects may use different service models depending on context.
Ideal Size of Free Cities
The speaker says a minimum viable long-term size for a free city may be around 10,000 people.
He compares this with small states such as Liechtenstein, which has around 35,000 people, and Hong Kong, which has around 6–7 million people.
Free private cities are expected to work best at populations in the tens or hundreds of thousands.
Current projects are still much smaller.
Próspera and Morazán each began as around 58-acre developments. Próspera has since expanded to about 150–160 acres.
Other Projects and Intentional Communities
The speaker says the most complete free private city elements currently exist in Honduras through Próspera, Morazán, and a third ZEDE.
Other projects with libertarian or autonomy-oriented elements include:
- Liberstad in Norway
- Liberland, between Croatia and Serbia
- Various intentional communities with legal gray areas or partial autonomy
These projects may have committed residents or a strong ethos but often lack full legal autonomy.
Liberty in Our Lifetime Conference
The foundation is hosting an event called Liberty in Our Lifetime in Prague from October 21–23.
The theme is “Parallel Structures for Progress.”
The event focuses on the idea that change can come from building parallel alternatives rather than trying to control existing institutions.
Parallel structures discussed include:
- Governance alternatives, such as autonomous cities
- Finance alternatives, such as Bitcoin
- Education alternatives, such as online learning
- Other institutions outside standard state systems
The purpose is to showcase practical projects that help people gain greater sovereignty.
Practical Takeaway
The discussion presents free private cities as a voluntary, contract-based alternative to conventional political governance.
The main points are:
- Hong Kong, Singapore, Monaco, and Shenzhen show how freer jurisdictions can create major growth.
- Existing political systems often make broad reform difficult.
- Autonomous zones can let people opt into different rules without forcing changes on everyone.
- Honduras has the most advanced current examples through ZEDEs such as Próspera and Morazán.
- The Honduran model is under political pressure, showing why constitutional and treaty protections matter.
- El Salvador is experimenting with Bitcoin legal tender and Bitcoin education.
- Panama may be an interesting future jurisdiction because of Bitcoin policy, territorial taxation, Ocean Builders, and regional positioning.
- West Africa may offer opportunities, but some talks remain confidential.
- Free private cities depend on private property rights, citizen contracts, voluntarism, exit rights, independent arbitration, and market-based service provision.
The core message is that people seeking more freedom do not need to wait for entire countries to reform. They can build and support parallel jurisdictions, financial systems, education systems, and communities where people voluntarily choose better rules.
